SECO (IOT)

Equity Research 8 September 2026 | 12:43PM BST

SECO (IOT.MI): First take 2Q26: Results in line with pre-announcement; adj. EBITDA lower; 3Q26 guidance reiterated

Results: Mohammed Moawalla | SECO reported 2Q26 results today, broadly in line with its pre-announcement, with Goldman Sachs International revenues of €50.2mn. Gross profit was also broadly in line at €28.2mn, implying a Deepshikha Agarwal gross margin of c.56%. Adjusted EBITDA came in modestly lower at c.€9mn in Q2. | This was primarily driven by increased personnel costs in R&D and operations to Goldman Sachs India SPL

support the new Arezzo plant, which more than offset the expansion in gross margin. Uzair Merchant | We await more details during the call. Goldman Sachs International

Ahlam Haouach Guidance: | More importantly, SECO reiterated its 3Q FY26 guidance of total revenue of >€60mn, Goldman Sachs International

implying acceleration of growth in the second half of 2026.

We await further details during the 2:30 PM CET call today, and believe the key focus areas will be on: 1) 3Q26 revenue and margin guidance; 2) the current operating environment and demand outlook; 3) more colour on the top line, costs and margin trajectory across 2H26; 4) traction in CLEA; 5) new customer pipeline and further cross/upselling opportunities; 6) more colour on its recent physical AI announcements; and 7) any new potential M&A opportunities.

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

Exhibit 1: Actuals vs GSe EUR mn

2Q26 Actual GS Actual vs. GS est. %

Revenues 50.2 50.0 0% % yoy -2.0% -2.5%

IoT (Software) revenue 3.4 4.4 -22% % yoy -44.3% -28.2%

Adj. Gross profit 28.2 26.3 7% % margin 56.1% 52.7%

Adj. EBITDA 9.4 10.5 -10% % margin 18.8% 21.0% % yoy -11.9% -1.7%

3Q26 Guidance Actual GS % variance

Revenues 60.0 48.9 23% % yoy 25% 1.9%

ex-fx growth based on GSe fx assumptions

Source: Company data, Goldman Sachs Global Investment Research

Price Target Risks and Methodology - SECO We are Buy-rated on SECO. Our 12‑month price target is €3.5 and is based on 24x 2Q27–1Q28E P/E.

Key downside risks to our view and price target are as follows: (1) macroeconomic risks impacting cyclical end markets and weighing on the growth trajectory; (2) supply chain component shortages and price increases impacting SECO’s ability to deliver products and pricing; (3) increased competition from IoT software players; (4) customer concentration risks, with the top 10 accounting for c.55% of 2020 revenues; (5) lower-than-expected cross sell/upsell or take-up of IoT software solutions; and (6) M&A integration and execution.